By Pietro Lombardi

UniCredit SpA on Thursday reported consensus-beating results for the third quarter. Here is what we watched:

NET PROFIT: The Italian bank's net profit for the period fell 42% to 680 million euros ($797.1 million), but beat analysts' expectations of EUR300 million, according to a consensus forecast provided by the bank.

REVENUE: The bank's top line dropped 7.4% to EUR4.35 billion, beating expectations of EUR4.21 billion.

WHAT WE WATCHED:

-TARGETS: The bank improved its cost savings target and confirmed the profits targets for this year and the next. "We have improved our gross savings target for 'Team 23' by 25% to EUR1.25 billion," Chief Executive Jean Pierre Mustier said.

-PROVISIONS: Provisions for credit losses rose 32% to EUR741 million. However, they came below analysts' expectations of EUR1.11 billion, and were 21% lower than what the lender had set aside in the second quarter. UniCredit expects its cost of risk to rise in the last three months of the year compared with the third quarter.

-REVENUE STREAMS: Net interest income fell 8.6% on year, while fees were down 6.4%. Trading income rose more than 10%. "Revenues were [roughly ] 3% better vs. consensus, mainly driven by higher trading income," Citi said.

Write to Pietro Lombardi at pietro.lombardi@dowjones.com; @pietrolombard10

(END) Dow Jones Newswires

November 05, 2020 05:57 ET (10:57 GMT)

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